Start your saving plan early
Save, save, save. While most lenders require a deposit of at least 5% of the property's value, bigger is better. A larger deposit may help you to avoid costly Lenders Mortgage Insurance, which is charged when a home buyer borrows more than 80% of the property's value.
Putting a savings strategy in place early on in your financial lifecycle will make it easier to obtain finance and purchase your dream home down the track.
Get your finance pre-approved
Negotiations are far easier once you have your finance pre-approved. Property sellers are often attracted to buyers who have pre-approved finance over those who don't. Loan pre-approval allows you head into the purchase process;
Shop around for that home loan
Compare interest rates - this amount can make a significant difference to your repayment costs. Your home loan may be the biggest debt you ever have so it makes sense to ensure you receive a great value deal.
Know what you want
Write down a list of features that the property must have, including the number of bedrooms and bathrooms you require, whether you need a covered garage for your pride and joy (the car) or a large back yard for your puppies.
Once you have done this, you can narrow down the list of homes to inspect. It will save you time – no need to be looking at homes that don’t meet your requirements.
Know the market
Spend some time on a real estate website and attend open homes and auction to get some knowledge of the market. By doing this you will have a better idea of the true value of the area you have chosen and be in a better negotiation position. Then with knowledge, you can then start talking to agents. The last thing you want is to fall in love with a home, to find out later, you paid too much. Be real estate savvy.
Save time by using Professionals
Mortgage brokers can take the stress out of the home buying process. These guys know their business. They will be able to do the leg work for you, obviously with relevant information supplied by you. They will also help you understand exactly what is required throughout the home buying journey.
Inspections – Pest & Building
This is a MUST to safeguard you. A Professional inspection will give you an insight into whether the property is worth buying. This may well save you a lot of money in the long run.
Consider your suburb & surroundings
Where do you want to buy? Perhaps the area you want is slightly more than you want to spend, look at suburbs close by. Source information from local council, local publications and connecting with local websites & bloggers can give you a real insight into different areas. If the area you are attracted to due to the rising value, this may well spill over into the next door suburbs, so have a look at them as well.
Be clever when you inspect a property. Homes are naturally staged to make sure they look fabulous for viewing. Remember to look between the lines for issues that might not be immediately obvious. Practical things that you should check:
Take notes and get your building or pest inspector to follow up on anything unusual or concerning.
Up front costs
Will you have to pay lenders mortgage insurance? Depending on where you live, there may be stamp duty, plus moving costs and legal fees (such as conveyancing fees). You may also be eligible for a first home buyer grant, which can help offset these.
Buying a home is an exciting time, but be prepared to keep looking. Be clear about what you are looking for so you get exactly what you want within your budget. But most of all enjoy the experience.
Submit your best offer up front
Make sure you offer a realistic offer and submit it with a list of comparable sales to support your offer. There is no time to haggle.
There are a couple of do’s and do not's when it comes to Auctions:
If you don’t understand the paperwork, terminology or process – ask your agent. Take the time to read all documents prior to signing.